🌏 AR you kidding?

Good morning, Quartz readers!

Here’s what you need to know

Core values. Apple topped quarterly earnings estimates as people rushed to buy its products ahead of tariffs amid other macroeconomic concerns.

Prime results? Amazon beat earnings expectations thanks to its AWS workhorse and ad sales, but shares still sank immediately after, offering little relief to a tough 2025.

Warren’s piece — or peace. Berkshire Hathaway is gearing up for its earnings report, and investors will be keeping a close eye on where the Oracle of Omaha invested — and what a future without him might look like.

Barra-ling through uncertainty. GM CEO Mary Barra said in a letter to shareholders that tariffs could cost the company $5 billion; the automaker already pulled its 2025 profit guidance.

Stars, stripes, and emptier flights. The U.S. travel industry is in a sharp decline — poised to post its first trade deficit in ages — as fewer international fliers want to visit the country.

Trade-offs coming. The Chamber of Commerce just asked President Donald Trump to implement tariff changes to “stave off a recession,” warning they could cause “irreparable harm.”

Supersized caution. McDonald’s disappointing first-quarter earnings had a bigger message at play: Customers are “grappling with uncertainty,” according to its CEO.

Power steering issues. Tesla may have denied that it was looking to replace Elon Musk as CEO, but one analyst says this “warning shot” was a sign of something that can’t be ignored.

Glasses half full — or empty?

Meta CEO Mark Zuckerberg may see the world through AI-powered glasses, but its bottom-line is still grounded in good, old-fashioned advertising revenue. The company posted strong first-quarter earnings — thanks to its ad business, not its CEO’s metaverse dreams.

The company’s Reality Labs division, home to Meta’s augmented and virtual reality initiatives, continues to hemorrhage money. It reported a first-quarter operating loss of $2.96 billion on $695 million in revenue. The division’s operating loss was $4.2 billion. Since 2020, Reality Labs has burned $60 billion — with nothing really to show for it.

But Zuckerberg keeps trying to make the metaverse a reality. On Wednesday’s earning’s call, he touted Meta’s advancements in AI-powered Ray-Ban glasses, Quest 3S VR headsets, and experiences in Horizon’s virtual reality playground.

Meanwhile, ads across Facebook, Instagram, and WhatsApp are performing better than ever, boosted by AI tools that are helping marketers target, convert, and cash in. So while Zuckerberg’s busy building a future where we chat with our glasses, it’s the feed — not the frames — that’s footing the bill. Quartz’s Shannon Carroll has more on why Meta’s vision might need corrective lenses.

AI on the prize

Microsoft just crushed its earnings report — and possibly a few doubts about AI’s business case in the process. The tech giant reported $70.1 billion in revenue for the quarter, up 13%, with cloud revenue from Azure growing 33%. Nearly half of that cloud growth came from AI workloads, giving Wall Street exactly what it’s been waiting for: proof that AI isn’t just hype, it’s a revenue engine.

Enterprise demand is accelerating. Commercial bookings jumped 17%, and Microsoft’s future revenue backlog surged past $315 billion, with big-name clients such as Coca-Cola, BNY Mellon, and Abercrombie all on board.

Even better: The company says its AI infrastructure is also getting leaner and meaner. That efficiency is helping Microsoft convert its massive capital spend into real returns faster than expected. Wedbush called the quarter “Aaron Judge-like,” and Wall Street appears to agree. Quartz’s Catherine Babb has more on how Microsoft’s cloud is raining money.

More from Quartz

🚙 As auto tariffs take hold, these 5 cars will be hit harder than others

🪷 DOGE is a “way of life,” Elon Musk just said — “like Buddhism”

🏙️ If you’re looking to start a business, these cities are your best shot

🏡 Reasonable rents still exist, and here’s where to find them

Our best wishes on a safe start to the day. Send any news, comments, and more to [email protected].